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工商银行
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银行和金融服务
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2016-11-07
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4.42
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4.04
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--
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4.57
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3.39% |
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4.67
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5.66% |
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详细
9M16 NPAT up 0.5% YoY; NIM stabilizingQ316 net profit after tax (NPAT) decreased 0.2% YoY/4% QoQ to Rmb72.6bn. 9M16NPAT was Rmb222.8bn, up 0.5% YoY and representing 85%/82% of UBS-S estimates/consensus. The results were better than we expected: 1) Q3 total loans rose 9% YoYand NIM dropped 3bps QoQ. Excluding the impact of value-added tax, NIM was flatQoQ, with management expecting NIM to stabilize in the next few quarters. 2) Feeincome rose 2% YoY. 3) Annualized credit cost in Q316 was 61bps, down 6bps QoQ. We are lifting our 2016/17E net profit 5%/7% to reflect a better asset-quality outlook. Sound asset qualityAs of Q316, the non-performing loan (NPL) balance increased 6% QoQ, with the NPLratio up 7bps to 16.2%. The coverage ratio fell 6.9ppts to 136%. 9M16 new loanswere Rmb980.7bn, among which new mortgage loans accounted for 54% and publicconstruction project loans accounted for 24.5%. Currently, the NPL ratio of mortgageloans is 0.45% and average loan-to-value is 50.5%. Management mentioned it is notworried about mortgage loan asset quality. Solid capital positionThe common equity tier 1 (CET1) ratio at end-Q316 rose to 12.58%, up 4bps QoQ andthe second highest among the banks we cover. The tier 1 capital adequacy ratio andtotal capital adequacy ratio were 13.13% and 14.18%, respectively. We estimate thebank's CET1 ratio is sufficient to support its asset growth in the next 2-3 years withoutthe need for fundraising. Valuation: Raising price target 7% to Rmb5.8; maintain BuyThe bank is trading at 0.8x 2016E P/B. We derive our price target using a PB/ROEmethod and reach our target 2016E P/B of 1.09x on long-term sustainable ROE of11.0%, 10.5% cost of equity and long-term growth of 5%. We maintain our Buyrating.
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